The Debt Management Office (DMO) sold Treasury Bills (T-bills) worth N2.42 trillion in September 2026, up 8.95 per cent from the N2.22 trillion recorded in August, as demand for the Federal Government’s short-term debt instruments remained strong.

Data from FMDQ Securities Exchange released at the weekend showed that September sales of N2.42 trillion, valued at N2, 417.48 billion, rose by N198.55 billion from the N2, 218.93 billion recorded in the preceding month.

T-bills were oversubscribed by 386.74 per cent during the period, indicating that investor bids substantially exceeded the amount of securities available for allocation.

The increase in sales highlighted the continued importance of T-bills in the Federal Government’s domestic borrowing programme. The instruments provide short-term financing for the government, while offering investors an avenue to invest in securities backed by the sovereign.

T-bills are short-term debt instruments issued at a discount and redeemed at face value on maturity. They are typically offered in 91-day, 182-day and 364-day tenors, allowing investors to choose securities that match their investment horizons and liquidity needs.

The DMO issues the instruments through periodic auctions, during which investors submit bids for the available securities. The amount eventually allotted depends on the outcome of the auction and the government’s issuance decisions. Consequently, the value of bids received may be substantially higher than the amount ultimately sold.

The 386.74 per cent oversubscription recorded in September indicates that demand was considerably above the available supply.

Investors, including banks, asset managers, pension-related investment funds and other eligible participants, use the instruments to invest funds over relatively short periods.

The September increase in sales came as investors continued to show substantial interest in T-bills, particularly the 364-day instrument, which attracted the bulk of subscriptions at individual auctions during the month.

At the September 2 auction, investors submitted bids totalling about N3.35 trillion against an offer of N700 billion across the three tenors. The DMO allotted N865.71 billion, while the stop rate on the 364-day bill declined to 16.84 per cent from 17.15 per cent at the previous auction.

The pattern continued at the September 9 auction, when subscriptions reached approximately N2.64 trillion against N750 billion offered. The DMO allotted N1.05 trillion, while the stop rate on the one-year bill fell further to 16.62 per cent.

At the September 23 auction, demand rose to N4.23 trillion against an offer of N500 billion, while the DMO allotted N497.59 billion. The stop rate on the 364-day bill fell to 15.89 per cent after the CBN cut the Monetary Policy Rate by 350 basis points to 23 per cent from 26.5 per cent.

These auction results showed that strong demand persisted even as the government’s short-term borrowing rates declined. The figures also highlighted investors’ preference for the one-year T-bills over the shorter tenors at the auctions.

Operators have attributed the strong demand at the September auctions partly to improved liquidity in the financial system and the easing of monetary policy.

The Financial Markets Dealers Association (FMDA) in its September 23 T-bills auction review said higher demand, improved system liquidity and the reduction in the CBN’s policy rate supported the decline in T-bills.

The association noted that total subscriptions had risen to N4.23 trillion from N2.64 trillion at the preceding auction, while the average secondary-market yield fell to 18.46 per cent on September 22 from 18.82 per cent on September 9.